Thank you, operator, and good morning, everyone. Joining me on today's call are Vericel's President and Chief Executive Officer, Nick Colangelo, and our Chief Financial Officer, Joe Mara.

Before we begin, I would like to remind you that the discussions during this conference call will include forward-looking statements. Factors that could cause actual results to differ materially from expectations are discussed more fully in the company's most recent filings with the SEC.

Also, the discussions today will include certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures can be found in today's press release, that is an exhibit to Vericel's current report on Form 8-K filed today with the SEC.

A short presentation with highlights from today's call is also available in the Investor Relations section of our website. I will now turn the call over to Nick.

Thank you, Eric, and good morning, everyone. The company had a great first quarter as we delivered outstanding financial and commercial results across the business and achieved a number of key business objectives that position the company to continue to generate strong revenue, profit, and cash flow growth in 2026.

The company generated record first-quarter total revenue of more than $68 million, which increased 30% over last year and significantly exceeded our guidance for the quarter, driven by substantial growth for both MACI and the Burn Care business. This strong revenue performance drove significant margin expansion and profit growth, as gross margin increased over 300 basis points, adjusted EBITDA margin increased nearly 800 basis points, and adjusted EBITDA tripled to nearly $10 million.

We also generated more than $15 million of free cash flow, ending the first quarter with over $210 million in cash and investments, as we continue to strengthen the company's top-tier financial profile. Based on our first-quarter outperformance, the significant momentum across the business that has continued with a strong start to the second quarter, and the NexoBrid BARDA procurement revenue expected in the second half of the year, we're raising our total revenue guidance range by $10 million for the full year.

MACI had another great quarter as double-digit volume growth drove record first-quarter revenue of more than $56 million, representing 22% growth versus the prior year. Notably, MACI's trailing four-quarter revenue growth rate increased to 23%, compared to 19% in the prior four quarters, as we continued to execute on our strategic initiatives to deliver sustained high revenue growth for MACI.

To that end, we're capitalizing on our larger MACI sales force, which meaningfully increases overall reach across our MACI target surgeons and provides an opportunity to continue to drive growth in new MACI surgeons, as well as deeper penetration within our current MACI surgeon practices. This was the first quarter with the expanded MACI sales force in their new territories, and they're off to a great start as we generated record first-quarter biopsies, implants, and biopsy- and implanting surgeons, as well as the second-highest number of biopsies and biopsy surgeons in any quarter since launch.

Importantly, as the quarter progressed, implant growth accelerated for both new and legacy territories, driving strong double-digit implant growth in the quarter. Growth in biopsies per surgeon also accelerated in the quarter, demonstrating deeper penetration within MACI surgeon practices and driving another quarter of double-digit biopsy growth, which was particularly strong in our new territories.

Finally, with more concentrated call points in the smaller territories, biopsy pull-through to implants increased during the quarter, demonstrating the potential for the larger sales force to increase the biopsy conversion rate over time. Overall, we're very pleased with the progress to date of the expanded MACI sales force, as well as the impact of our commercial excellence initiatives, which have enhanced our commercial analytics and standardized best practices across the larger sales team.

We believe that these initiatives will continue to elevate execution across the MACI commercial organization and drive deeper penetration within our surgeon user base. We're also focused on leveraging MACI Arthro to drive continued growth in the treatment of smaller cartilage defects and to expand overall MACI utilization.

Leading indicators remained strong in the small condyle segment, with higher first-quarter and trailing biopsy growth rates than the overall biopsy growth rate, and higher biopsy conversion rates to date for surgeons that have completed a MACI Arthro case. We're also making significant progress in our efforts to generate new clinical data demonstrating the potential for improved patient outcomes with the less invasive MACI Arthro procedure.

Early data from ongoing investigator case series suggests a significant reduction in postsurgical pain, improved range of motion, and a meaningful acceleration in the timeline to achieving full weight-bearing following MACI Arthro treatment. These initial data results, which were recently accepted for publication, suggest positive patient outcomes that could also lead to shorter overall rehab and recovery timelines.

We're also continuing to work with additional surgeons as they complete MACI Arthro cases to collect prospective outcomes data in our MACI Clinical Outcomes Registry. Finally, we achieved an important milestone for the company with the FDA approval for MACI commercial manufacturing at our new facility, which began in the second quarter.

This important achievement not only increases our manufacturing capacity to support the long-term growth of MACI in the US, but also enables the potential commercialization of MACI outside the United States. To that end, we remain on track to submit a MACI marketing application in the UK later this year, and if approved, to potentially launch MACI in the UK in 2027, as we seek to expand the long-term growth and value creation opportunities for the company.

Burn Care first-quarter revenue increased over 90% to $12 million, which was above our guidance range for the quarter and represented one of the highest Burn Care revenue quarters to date. We also announced a BARDA award valued at up to $197 million for the procurement and advanced development of NexoBrid.

The base period contract of $35 million includes approximately $10 million over the next 12 months for the initial procurement of NexoBrid, funding for vendor-managed inventory related services, and initial development activities for a potential indication for the treatment of blast trauma injuries. The contract also includes optional awards for additional procurement and advanced development of NexoBrid over the 10-year period.

We're very pleased to work with BARDA to support US national preparedness for potential mass casualty events, and to drive further development of NexoBrid. More broadly, we believe that the BARDA award underscores the clinical importance of this innovative product and can help enhance the overall utilization of NexoBrid in the US market.

I'll now turn the call over to Joe to discuss our first-quarter results and our 2026 guidance in more detail.

Thanks, Nick, and good morning, everyone. As Nick referenced, from a financial perspective, the company had its strongest first quarter to date across all key financial measures, including top-line revenue, bottom-line profitability, and cash generation metrics.

Total revenue increased 30% to $68.4 million, which was significantly above our guidance range for the quarter, driven by strength in both commercial franchises. MACI's momentum continued as strong double-digit volume growth drove record first-quarter revenue of $56.4 million, representing 22% growth versus the prior year, which was significantly higher than recent first-quarter growth rates for MACI, and marks the fourth consecutive quarter with MACI growth of 20% or more.

Burn Care first-quarter revenue was $12 million, which was well above recent run rates and our guidance range for the quarter. Epicel revenue of $10.9 million was particularly strong, while NexoBrid revenue of $1.1 million increased nearly 60% versus the fourth quarter.

With these strong first-quarter results, the company is generating significant top-line growth across the business. MACI's trailing four-quarter growth rate increased to 23%, and the trailing four-quarter growth rates for both the company and Burn Care are also above 20%.

The company also delivered meaningful margin expansion in the first quarter. Gross margin increased over 300 basis points to 72%, and adjusted EBITDA margin increased nearly 800 basis points to 14%, with adjusted EBITDA growing 195% versus the prior year to $9.6 million.

Finally, the company generated operating cash flow of $16.4 million and free cash flow of $15.1 million, representing the third consecutive quarter with free cash flow of $12 million or more as the company's expected inflection in cash generation continues following the completion of our new manufacturing facility. We ended the quarter with approximately $211 million in cash and investments, an increase of nearly $50 million compared to the end of the first quarter last year.

Turning to our financial guidance. Based on our very strong first-quarter results across the business, as well as expected NexoBrid procurement revenue in the second half of the year under the recent BARDA award, we are increasing our full-year total revenue guidance range by $10 million.

We now expect total revenue of $326 to $336 million for the year, which represents total revenue growth for the company of approximately 20% at the midpoint of our guidance range. After a very strong first quarter, we are raising full-year MACI revenue guidance to $282 to $288 million, compared to the prior guidance of $280 to $286 million.

MACI is off to another strong start in the second quarter, and we expect approximately $62.5 to $63.5 million of MACI revenue for the quarter. Our guidance implies similar growth rates for the remaining quarters of the year, which is consistent with our framework to start the year, recognizing that there is an opportunity for outperformance based on the momentum in our key performance indicators, our expanded sales force, and the commercial initiatives that we have put in place.

We are also increasing our Burn Care revenue guidance based on the strong first-quarter performance as well as the incremental NexoBrid BARDA procurement revenue expected this year. We now expect full-year Burn Care revenue of approximately $44 to $48 million, compared to our prior guidance of $36 to $40 million.

For the second quarter, we expect approximately $9 to $10 million of total Burn Care revenue. In terms of NexoBrid BARDA procurement revenue, at this point, we expect approximately $5 to $6 million of revenue in the second half of the year, with procurement expected to begin in the third quarter.

Moving down the P&L, for the full year, we continue to expect gross margin of approximately 75% and adjusted EBITDA margin of approximately 27%, which accounts for additional costs related to our new Burlington manufacturing facility, the incremental investments related to our MACI sales force expansion, increased MACI ankle clinical trial expense, and incremental lifecycle management investments. For the second quarter, we expect gross margin of approximately 72% and adjusted EBITDA margin of approximately 18%.

Overall, 2026 is set up to be another positive year for the company, with strong revenue growth as well as continued margin expansion, profit growth, and cash generation. As we look ahead, we believe that the durable growth of our portfolio positions the company to sustain strong top-line growth and supports our midterm revenue and profitability targets.

This concludes our prepared remarks. We will now open the call to your questions.

Hi, thanks for taking the questions. I'm juggling calls this morning, I may have missed it, but just on the guidance outlook, you increase it looks like by the 1Q outperformance.

Just love to hear kind of what your assumption set is, especially for MACI trends and MACI Arthro moving through the year, and most particularly in the 2Q. Thank you.

Hey,

good morning, Rich. This is Joe.

I'll take that question, thanks for the question. In terms of the guidance update and the increase, I would say on a full-year basis, you're right, there's kind of two key drivers.

One, the outperformance in the first quarter at a company level, whether you look at guidance or consensus, is kind of in that $4 to $5 million range. We've included that in our full-year guidance update, let that flow through.

Then the second piece is the remainder of that increase is really the incremental NexoBrid BARDA revenue, which we expect to begin in H2, and call it we said about $5 to $6 million. If you kind of put that together, just quickly on the assumptions to the second part of your question, starting with Burn Care, obviously a very strong first quarter across the board for Burn Care.

It's actually our highest quarter since 2024, and a particularly strong Epicel quarter, feel like we're really executing well on the Burn Care side. To your question, we've assumed, call it about $2 million of outperformance from Q1 in our full-year outlook on Burn Care, and then that remainder, call it about $6 million, on the BARDA side.

Up $8 [million?] on a full-year basis on the Burn Care side.

If you kind of think about the guidance going forward, obviously there's some moving pieces, but we're sticking with our framework that's worked quite well on the Burn Care side over the last few quarters in our run-rate framework, which has been, call it $9 to $10 million on a quarterly basis, and then we're adding in the second-half BARDA. To be clear on kind of just how to think about that and how to model it, it's really call it $9 million in the second quarter, then it steps up to $12 million in both Q3 and Q4, with that incremental call $3 million of BARDA revenue flowing through.

That gets you to call it $45 million on a full-year basis on Burn Care. Again, we're not changing our assumptions in the back half of the year in terms of the core business, we're sticking with that run rate, but obviously great performance in the first quarter and the incremental BARDA revenue has been included.

On the MACI side, very strong first quarter as we talked about, a first quarter with our expanded sales force, and we feel like the team executed extremely well there, a much higher Q1 growth rate than we've seen in recent years. Importantly, we pointed to another quarter of both double-digit biopsy and implant growth in the first quarter.

Also say we've gotten off to a strong start in Q2 in April as well. Feel very good about kind of the MACI execution, particularly with that larger sales force.

From a full-year perspective, again, call it about a $2 million beat in the first quarter on MACI. We've included that on a full-year basis.

You kind of add that, update it to $285 [million?] on MACI, you're right around $330 million or so at the midpoint, which also is the midpoint of our guidance also 20% company growth.

That's important and good to see. In terms of the MACI assumptions for the remainder of the year, I think importantly, we're not changing any assumptions or our approach for whether it's the second quarter or the back half of the year in Q3 and Q4.

We're keeping the same framework and approach we used in Q1. I'd say we're going to remain very prudent on the guidance.

We've done that in the Burn Care side with the run-rate framework. We're going to continue to do that with MACI going forward.

The assumptions for MACI in total are essentially keeping that high teens growth for both Q2 as well as the back half. I think importantly, that also implies kind of similar year-over-year dollar revenue growth assumptions, which, again, we feel like is a balanced starting point and consistent to how we started the year.

It implies about $63 million in the second quarter, that's about 18% growth at the midpoint of our guide, and it's pretty similar for the remaining two quarters. Again, I would just say from a second-half outlook perspective, we definitely do not want to assume an acceleration in growth in the second half in MACI, this is consistent to what we talked about last quarter.

We think this positions us really well. To that point, whether it's kind of the sales force contribution, continuing to ramp up on Arthro, I would just say broadly, we maintain the recent trends we're seeing.

If we continue to execute well, we think this sets us up for potential outperformance both in the second quarter, but also on a full-year basis. For MACI in particular, the pieces are in place with very strong pull of biopsies.

We had a particularly strong Q4 that we think will play out during the year from a biopsy growth perspective. Leading indicators remain strong, and again, we have the larger sales force, which we think can be impactful.

We're going to remain prudent on both franchises, but certainly the goal internally is to outperform that, but again, we're not going to change the approach on the guidance and would rather just stay prudent there.

Thanks for that, really helpful. Then maybe just to follow up on the competitive landscape, you have a competitor that will likely be stepping into some better reimbursement situations in the first quarter of next year.

Just wanted to get a feel for how you see the market kind of segmenting, how you're kind of thinking and preparing for this, what you're hearing, if anything, from your customer base, and on expectations for that product and how it may or may not impact you guys. Thank you.

Hey, Rich, this is Nick, and so I'll take that question. Obviously, you're referring to Agili-C, which is a product we've talked about for years now as we've talked about potential sort of new market entrants.

The position that we've kind of taken is one that's kind of aligned with kind of our surgeon and KOL feedback that Agili-C is really a product that's geared towards use in older patients with osteoarthritis, and really as a bridge to a partial or full knee replacement where those patients have no other options. It was approved four years ago, it's been around, and really obviously hasn't had an impact on MACI to date, nor should it.

As these are two different patient populations: older osteoarthritic patients that are potentially more appropriate for Agili-C, and then the young, active patients where MACI is typically used. When you think about sort of the typical MACI patient, if you look at publications, a very small, low single-digit percentage of patients that are treated with MACI have any sort of bone involvement, even though it's included in the label.

There's no way, if you have a clean cartilage injury, that a surgeon is going to sort of core out over a centimeter of bone to use a product like Agili-C. We actually don't think there's a lot of overlap.

There hasn't been to date, nor should there be for these patients. If you take a double click on a couple dimensions, number one, as the patella treatment, or treatment of patella defects for MACI is our largest and fastest-growing part of the business historically.

Agili-C is contraindicated for use in patella defects, and so absolutely no impact on the biggest part of our business. It's not indicated for arthroscopic administration, we actually haven't seen much, if any, impact at all from Agili-C, nor do we expect to see it.

We do pulse surveys pretty frequently, and the surgeons that we talk to haven't used it, and don't really plan to use it in the future. So...

Thank you.

All right,

thanks, Rich.

Hey, thanks everyone, and congrats on a very nice quarter. You provided some encouraging commentary on accelerating implant growth, would love to get a sense of some of the progress you're seeing specifically from MACI Arthro, where and what portion of your implants today are coming from MACI Arthro, and have you been able to get some traction among those new accounts that you identified that typically were arthro-only?

Hey Mike, it's Nick. On MACI Arthro, obviously we're very pleased with our progress to date.

As we talked about on our last call, really strong foundation established in 2025 where we trained upwards of a 1,000 surgeons on MACI Arthro, and kind of at critical mass where those trained surgeons are responsible for kind of over half our implants already, really great critical mass there, great job by the team, both the medical and sales team in training surgeons. Obviously we talked about the fact that that contributed to growth last year, and in the first year on the market, as sort of the smaller femoral condyle defects that MACI Arthro are intended to be used for, the growth rate there was kind of at par with patella, which was great, compared to lower sort of single-digit penetration and lower growth in prior years.

As we said on the call, the leading indicators for MACI Arthro remained strong. We had higher first-quarter and trailing biopsy growth rates than the overall biopsy growth rate, and we continued to see that MACI Arthro implanters had higher biopsy conversion rates.

It's clearly been one of the factors in a multifactorial sort of dynamic that has sort of elevated MACI's overall performance. The fundamentals, as Joe mentioned, coming into this year were very strong, with biopsy acceleration in the fourth quarter.

We have a larger sales force that's off to a great start. We have MACI Arthro in there as well, which has generated a ton of interest.

Then the commercial excellence initiatives are clearly taking hold as well. We're pretty excited about the MACI Arthro start to date, and we expect it's going to continue to contribute to growth as we move forward.

Super helpful, thanks Nick. Maybe just one follow-up, but would love to hear a little bit more about the progression of the BARDA award.

Obviously some nice contribution expected already in the back half of this year, but how and when could we see that remaining $195-$97 million start to materialize over time?

We're really excited about working with BARDA to kind of help with US national preparedness for mass casualty burn events. We had talked about this potential award.

Obviously, it was delayed a little bit with the government shutdown, but it's a very meaningful overall contract, as you'd mentioned, nearly $200 million, and a $35 million initial award. Just to be clear, about two-thirds of the value of that award, whether it's sort of the base contract or the overall, flows in one form or another to Vericel, either through procurement and VMI service revenue, or other cost offsets for some of the other work that would go on.

The base contract is the $35 million. Obviously, that includes the initial procurement, and then VMI establishment and related services, and work around a potential blast indication, and those are already funded.

As Joe mentioned, on the procurement side, we expect that revenue over a 12-month period to begin in the third quarter, $5 to $6 million this year, the remainder early in 2027 on the procurement revenue, so that's 10 of the first 35. The other will involve obviously doing the work around sort of the proof of concept for the blast trauma indication, and that will start later this year and flow through, we'll probably give you a little more guidance potentially on that as we go through the year.

In terms of the optional awards, there's a number of components there as well, including additional ramp-up procurement, which is a pretty meaningful CLIN, or option. That will depend if you think about when BARDA had the initial stockpile, it was something like 16,500 units when they worked with MediWound on that.

Our initial procurement is about, call it roughly 3,000 units, with a ramp-up of another 5,000. I think BARDA's pretty interested in increasing the stockpile because we run it through a VMI that will require commercial progression and so on.

That'll play out, it's intended to start after the first year of procurement. Then, obviously if the proof of concept on blast trauma indication works out, that could trigger the second and further development for that indication.

Then MediWound's been working on a room temperature formulation, and work will continue, and to the extent that moves forward over the course of the next year, that could trigger further work on that room temperature formulation and additional procurement of that product, starting in 2027 and beyond.

Understood. Thanks very much, Nick.

Thanks, Mike.

Hi, good morning. Thanks, Nick and Joe, for the question.

Was hoping to just have you share your view just on the environment. There have been some concerns around ortho procedures, volumes just trending down, pressures from access hurdles like the ACA subsidy expiration.

Clearly, you're not seeing that in Q1 with the MACI franchise, and guidance suggests that you're not expecting to see much. Have you baked in any high-level ortho procedure volume pressures into the guide?

Seems like there is some conservatism in terms of the setup for the rest of the year in terms of how you've positioned guidance for MACI post-1Q. Would love to just hear what you're hearing and any more insights into your outlook.

Hey Josh, it's Nick. I'll start, and Joe can kind of talk about our guidance perspective.

We made a point on our Q4 earnings call because there was some commentary out there about slowing procedures in December and so on, and we actually had a stellar December, and we didn't see any impact there. Obviously, as we talked about, we had strong double-digit biopsy and implant growth in the first quarter.

I would say we haven't seen anything, nor have we baked any sort of procedural slowdown into the guidance. Joe, you can cover that a little bit more.

Just echo what Nick said. We certainly haven't baked into any expectations on kind of the negative side there.

Again, I'd probably go back to where Nick started, which is I think we referenced, we feel like we have a great pool of biopsies, we continued to generate double-digit growth there. Just to kind of talk again about Q4, we really saw a pretty significant acceleration in biopsy growth in the fourth quarter, and had a particularly strong December, and obviously that's our highest quarter in terms of activity.

That's really encouraging as we kind of make the turn into 2026, or having made the turn. What's important there, as Josh, is there's a longer kind of cycle here when we think about conversion, and from a conversion perspective, those typically convert over the subsequent quarters.

Some of that is probably early in Q1, but most of that is, frankly, whether it's Q2 or the back half of the year. We feel like we're in a very good position.

Of course, we're going to be mindful of the environment, but we haven't seen any signals that any of that slowdown is impacting any part of our business.

Excellent, that's great to hear. Also wanted to just touch on the international MACI expansion opportunity.

I know you guys are set up for potential launches in 2027. Can you just help us think about the buzz that's been generated by MACI, MACI Arthro, is there pent-up demand in specific countries?

Just anything again a little temperature check question in terms of what you guys are hearing from international ortho sports medicine specialists and the anticipation for getting access to MACI, MACI Arthro for their patients? Appreciate it.

Josh, it's Nick again. Certainly the international cartilage repair sort of community is very concentrated.

MACI, as was on the market in Europe when we first bought this business, and so there is a significant sort of interest in having MACI come back. We talked about it with the UK being our first sort of beachhead for a lot of reasons, potential expedited approval process, very high surgeon awareness and advocacy over there.

We had a positive NICE opinion for MACI back in the late teens. Really set up well in concentrated sort of cartilage repair surgical centers, centers of excellence in the UK.

It's a perfect sort of beachhead for us, as I mentioned, and yeah, there's a ton of interest and excitement about potentially having MACI back because there's very limited options in Europe right now for sort of restorative cartilage repair procedures.

Thanks, Nick.

All right, thank you.

Hi, congrats on a great quarter, and thanks for taking the questions. Maybe just starting with the sales force seems like they were beginning to really contribute this quarter.

Maybe just provide some metrics around that, and the time you're seeing it take these reps to reach break-even or close to break-even?

Hey Caitlin, it's Nick. Obviously, as we kind of referenced on our prepared remarks, we're really sort of pleased with the initial sort of expansion and the contribution that the new territories are making to our overall business.

I would just sort of remind listeners that the fact that we expanded our sales reps in Q4, and then obviously we realigned the territories, and everyone went into their new territories in Q1, with absolutely zero disruption in Q4 as the new reps were working together. Then, obviously a super-strong performance in Q1, as Joe mentioned, a higher growth rate than we've typically seen in the first quarter over the past several years.

I think that says it all in terms of kind of a flawless execution from the commercial leadership team and great execution from the reps themselves. As we referenced on the call, as the quarter progressed, we saw implant growth accelerate for both new and legacy territories, which led to that strong double-digit implant growth, and that continued into April for both legacy and new territories.

Off to a strong start, as Joe alluded to as well. The growth in biopsies per surgeon also accelerated in the first quarter, which is always our metric that we refer to for deeper penetration within MACI surgeon practices, and that led to another quarter of double-digit biopsy growth, and that was particularly strong in the new territories.

That continued. We had strong biopsy growth in the fourth quarter, accelerated again in Q1 in terms of biopsies per surgeon, really great metrics there.

Then, obviously they're getting up to speed very quickly. We talked about the fact that the pull-through to implants was very strong across the board.

They're smaller, more concentrated territories now, you're seeing great pull-through. Again, we don't look at it in terms of sort of how quickly do they get to break-even, they're certainly a good portion of them are already beyond break-even as they moved into these new territories.

Because again, it's not like they moved into white spaces, they were existing territories, existing biopsies, they did a great job on pulling those biopsies into implants in their territories, and then obviously building a pipeline for the rest of the year with their strong biopsy growth. Honestly, I don't think it could have gone any better.

That's great. Then maybe just talk through kind of the Epicel dynamics in the quarter and what really drove the strength?

Obviously as Joe mentioned, one of the highest Burn Care quarters we've had ever, and strongest since 2024. We talked about it last year that we kind of were taking a different approach to how we were sort of evaluating and working through each of the biopsies we receive, and I'd say probably the biggest contributor to Epicel's performance was some growth on biopsies, which is great, but really kind of converting those biopsies into grafts.

Again, that's just kind of a sales force execution with sort of clinical support on these patient treatment parameters as well. Really just sort of a different level of execution, not only for Epicel, but across the entire commercial organization.

Great, thank you.

Thanks for taking the questions here. On the potential near-term publication of data showing less post-op pain, faster range of motion, earlier weight-bearing, I guess, how material could that publication be in terms of catalyzing broader adoption or higher utilization of MACI Arthro?

Are there docs out there that are saying they'd like to see this peer-reviewed data on better patient outcomes before adopting or ramping use? Just trying to get a sense of what that could mean.

Hey, thanks, Mason, it's Nick. Obviously we've been talking about the fact that because MACI Arthro was approved through a human factors study, that you didn't really have that kind of clinical data at launch, but that we were very focused on building it both through individual sort of KOLs who do a lot of MACI Arthro cases and have these case series, which is the first set of data that demonstrates those early positive outcomes, which could lead to the longer-term patient outcomes and the benefits there, as well as through our MACI Clinical Outcomes Registry where that can lead to a series of publications over time.

There's no doubt that clinical data is important. I don't think we hear a lot of we need to see those outcomes I think it's just intuitive to the surgeons that a less invasive surgery, you have these better early outcomes, but we definitely want to have the clinical data to support that.

I would use kind of our experience with patella as an analog. Back in the teens, 2017 when MACI was launched, there were no patella patients in the study, and over time, there were publications about the effectiveness in the patella of MACI treatment, that led to even broader coverage by insurance companies.

We referenced back in the early 2020s UnitedHealthcare adding patella cases to its medical policy. There's no doubt over time that that kind of clinical data will just support continued utilization and uptake of MACI Arthro.

We're really focused on that, we think it'll have a very positive impact. ):

Got it, that's helpful. Then on the dynamic of Arthro-trained surgeons showing higher biopsy and implant growth than untrained surgeons, has that gap widened or narrowed or stayed the same as the trained base of surgeons has grown?

Obviously I would say broadly and at the higher level, those trends that we saw in trained surgeons remain. Now, we're kind of getting into a point now where we have this relatively large critical mass of MACI users who are now trained and you're kind of lapping the quarterly things.

The gap is a little narrower, but the trends remain the same, that they definitely kind of increase their biopsy and growth rates. ):

Got it. Thanks, guys.

Hey, thanks, Mason.

Good morning, thanks for taking the questions. Hi, Nick and Joe.

Just one from our perspective. Could you drill in a little bit further on the Burn franchise?

Want to know a little more about Epicel, maybe per case, number of cases, and NexoBrid, and talk a little bit about the franchise as well as the commercial organization and some cross-selling and awareness on NexoBrid.

I'll start, Jeff, and Joe can kind of jump in. I'd say on Epicel, it's kind of as I mentioned.

Obviously it was a very, very strong quarter driven mostly by biopsy growth, but more importantly sort of of the biopsies we received, sort of a higher treatment rate for those patients, which is great. As in some quarters in the past couple of years, there were issues around patient health, and those biopsies didn't really convert into the grafts.

I think that was my point around commercial execution. I think the team, both the medical and commercial teams, are doing a great job on focusing on how you take those biopsies and treat patients and realize that patient benefit of Epicel.

That's kind of the dynamic with Epicel. We're encouraged, it's been a series now of good strong quarters for Epicel.

On NexoBrid, we remain excited about the opportunity. Obviously, the BARDA contract reinforces the clinical utility of the product, and as we've talked about, it takes time to change standard of care, especially when you're going from a surgical to a non-surgical approach.

This obviously kind of bolsters the revenue and utilization potentially for NexoBrid as we move forward. We expect that over time we're going to see kind of that continued uptick in NexoBrid utilization, very positive sort of kind of broadening of the number of ordering centers for NexoBrid to start the year, which, again, we think will translate into higher utilization as we move through the year.

Obviously, we have reps now that to your cross-selling point promote both Epicel and NexoBrid, and yeah, we've talked repeatedly about the fact that ideally we have utilization of both products in every burn center, but certainly having NexoBrid has allowed us to sort of regain traction with some of the dormant burn centers over time. I think a good string of quarters now for Burn Care, and we certainly expect that to continue.

I would say not a whole lot to add. This is Joe.

Just to echo a couple of Nick points. I think this sort of commercial excellence initiatives we're talking about, just to be clear on those, we obviously talk about that a lot from a MACI perspective, but certainly there's a number of things we're doing on the Burn Care side to kind of replicate the same commercial excellence, better analytics, etc., as we think about execution.

I think certainly on the Burn Care side, that's important to point out. Then as Nick talked about on the NexoBrid side, or just in burns in general, you can see quarter-to-quarter there can always be changes in terms of the number of burns, and we look at that data, but we are definitely encouraged on NexoBrid.

We are starting to see a broadening of centers, and we've seen actually a growth in the number of orders. Our strategy to sort of drive higher uptake there is how can we sort of not only get kind of our regular ordering centers continue to stay kind of high and strong, but try to move the rest of the business from starting to use NexoBrid more toward the middle and making them more regular orders.

We're actually seeing some good signals there on the NexoBrid side. I think similar to MACI, I think on the Burn Care side, if you kind of take a step back, the execution has been quite strong, in particular the last few quarters, and obviously we had a great Q1.

Perfect. Thanks for taking the questions.

Thanks, Jeff.

Hi, Nick, Joe, this is Izzy on for Ryan. Thanks for taking the questions.

Just to start, Nick, you touched on this to earlier question, but I was hoping you could speak a little bit more about the segmentation that you're seeing in the market for cartilage lesions between MACI and other two-step procedures in terms of the lesion type, anatomical segmentation, grade levels, etc.

I don't think anything's changed. As I mentioned, we've talked about sort of the competitive landscape for MACI for several years.

It's been obviously very static certainly over the past four years plus, and pretty much essentially since we launched the product. MACI stands alone as the clear market leader in cartilage repair.

There are no other MACI-like products, so that hasn't changed at all. There's very complicated decision-tree treatment algorithms that are publicly available for sort of how surgeons think about different patient types based on size, location of the defect, age, ability to do rehab, things like that, and that hasn't changed at all over the years to any significant degree.

We talked about there's Agili-C sort of for older or osteoarthritic patients, and then some other sort of more microfracture augmentation kinds of products, and there's been a bunch of both of those kinds of things. Synthetic implants have come and gone over the years.

You have a bunch of microfracture augmentation products that are out there for smaller defects. I'd say relatively status quo, and MACI again just remains the clear market leader and that has expanded over time.

Appreciate that. Thank you.

This is maybe a longer-term dynamic, but could we ever see a master cell line for a one-step MACI in the future? Thanks for taking the questions.

Obviously MACI is an autologous cell therapy product. There have been those in years gone by that have kind of thought about allogeneic approaches.

We, in fact, have developed an allogeneic cell line. Is it possible?

Perhaps. There's a lot of technical issues that would be required there, and to my knowledge I think there was one potential early-stage clinical study more than a decade ago that was abandoned, there's really nobody anywhere near clinical development right now for that.

I guess it's kind of a misnomer to a certain extent to say that a product like that would be a one-step procedure. There's not a lot of one-step off-the-shelf procedures in cartilage repair.

There's often, probably most often, a diagnostic arthroscopy to determine sort of the extent of a cartilage injury, or as part of other arthroscopic investigational procedures a cartilage defect is noted, and then a treatment plan is put in place. It's again a bit of a misnomer to talk about one-step procedures, especially where sort of prior authorizations will be needed or just sort of patient being informed and consenting to a certain treatment will be required.

Anyway, hope that helps.

Thank you. This is RK from H.C.

Wainwright. Good morning, Nick and Joe.

Thanks for taking my questions. I have a couple of them, since most of my questions have been answered.

On the biopsies and implants, in terms of the biopsy and implanting surgeon counts, what percentage of them were repeat versus first-time users? Also with the record biopsies, how much of that is coming from the new sales force?

What incremental gain did you get from the new sales force?

Good morning, RK. This is Joe.

I'll start. I'd probably say can certainly talk about the metrics, but perhaps at a slightly higher level.

I would say we've obviously seen very strong kind of biopsy growth over the last few quarters, really last several years since COVID. We've seen that consistent double-digit growth in biopsies, we think that positions us well.

I think we're sort of highlighting the biopsies per surgeon because we feel like that's an important metric to make sure we're kind of driving depth, and we think that those are surgeons that we think have a significant, probably more significant opportunity when we see that metric kind of tick up to sort of pull through those biopsies into implants. It's an important metric.

Obviously that's coming from you're going to see a mix of existing and new surgeons, but that'll be weighted more toward existing surgeons just based on the metrics. That's important for us.

I will say one note on that is with the strong kind of biopsy growth, we've obviously seen similar implant growth over the last few years and a few quarters kind of tracking, they generally track together, and you would expect that with a stable conversion rate that we've talked about. As Nick referenced in his prepared remarks, we're seeing some good signals from an Arthro implanter perspective in terms of some of the conversion metrics there, and obviously very early days with the new sales force, but encouraged with the kind of pull-through we've seen there.

I'd say our conversion rate has kind of consistently been stable, but we are seeing some positive signs there. For example, if that kind of ticked up a bit, that would be upside for us.

We're not going to bake that into our kind of guidance or kind of long-range outlook, but that's been a metric we have been highly focused on for the last few years, and so that's something we'll continue to focus on. Then remind me of the second part of your question?

No, I was just wondering how much of the gains came from the new folks on the sales force?

I'd probably just point to what we talked about, which is we definitely saw significant strength in the metrics, I'd say across the board. As Nick talked about, the execution to kind of bring on our new sales force, how they sort of were integrated into Q4, which was strong, how they've performed so far in Q1.

I would say we've been pretty pleased right out of the gates, and these are very experienced reps that have kind of relationships they're bringing into our business. I think it's certainly a mix, I would say, of our legacy reps and our new reps, but we've been encouraged with what we've seen so far from our new sales force.

Okay. One last question, if I may.

This is on the Arthro product. What do you think is the Arthro's penetration within the small condyle defect TAM?

Also, what is your estimate of the addressable Arthro-eligible patient population right now?

We think obviously there's been a meaningful contribution from MACI Arthro in that segment because that's what the instruments are designed to do. We're very pleased there.

As we talked about, when you kind of take it up a level, the biggest part of our business is in patella, it's a fast-growing part of the business, the current instruments aren't really designed for those, although some surgeons are using that. That is kind of a sort of life-cycle iteration that we're considering doing for patella.

Right now, that's kind of typically done open. The larger defects are done open procedures.

Within appropriate sort of size 2- to 4-square-centimeter defects on the femoral condyles, without concomitant kinds of other procedures that need to be done, we're pretty pleased with sort of the penetration we're seeing in that sort of subsegment of the smaller femoral condyle defects. It's the biggest part of our TAM, that's why we're focused on growing it.

Again, just like patella, we think over years that we're going to see some pretty significant impact in that particular segment.

Thanks for taking my questions.

Thanks, RK.

I'll just close by thanking everyone for joining us this morning. Obviously, the company had an outstanding first quarter, and we feel like we're really well positioned to continue to deliver what is a very unique combination of sustained high revenue growth, profitability, and cash generation in 2026 and the years ahead.

We look forward to providing further updates on our next call, and thanks again, and have a great day.